If your wife needed to move into a care home she would have to meet the full cost herself, if her savings exceeded the means-test limit (currently £21,000). The local authority should only financially assess the person that needs the care, so your savings should not be taken into account. If your wife owns a share of your home, this is also disregarded as long as you continue to live there.

Regarding payments from your wife through her power of attorney, these should be allowed, as long as they are bona fide payments and not deliberate deprivation of capital. If your wife’s savings are held in an investment bond that carries an element of life insurance, as most do (usually 1 per cent of the fund value on death) then this should also be disregarded from the means-test, as long as the investment has been held for some time. If she were to invest the money now into such a vehicle, the local authorities are instructed to view this as deprivation of assets and therefore not to disregard it.

If your wife has to fund her own care, make sure she claims attendance allowance – worth £52.25 per week at the higher rate. If she needs nursing in a nursing home, then she should receive a registered nursing care contribution from the NHS of anything between £40 and £133 per week or, if her care needs are primarily health care, she could be entitled to full continuing care funding from the NHS.

Financial advice for your wife should only be provided by a financial adviser who has the relevant FSA-required specialist long-term care advice qualification CF8. For more information on treatment of couples visit www.nhfa.co.uk and download Infosheet 7 ‘Treatment of Couples’.